Explanation of Article 63
This article addresses the statement of the "subject matter of the contract," which is: what the contract pertains to, such as: the sold item in a sales contract, and the rent in a lease contract, and it is a pillar of the contract.
The article stipulates that the subject matter of the contract must be "existent," meaning: the subject matter of the contract must exist in reality, and not be non-existent. For example: it is not permissible to contract for the sale of something that does not exist, or the sale of something non-existent.
It is worth noting that the subject matter of the contract must be "possible," meaning: the subject matter of the contract must be achievable, and not impossible. For example: it is not permissible to contract for the sale of something that is impossible to achieve, or the sale of something that is impossible to deliver.
The article emphasizes that the subject matter of the contract must be "lawful," meaning: it must not be contrary to public order or public morals. For example: it is not permissible to contract for the sale of drugs, or the sale of unlicensed weapons, or to contract for gambling, or to contract for the sale of human organs, and the like.
The failure to meet any of these conditions results in the "nullity of the contract," and it does not produce any legal effect.
Related To
Article 63
If the deceptive act was committed by a non-contracting party, the deceived party may not demand nullification of the contract, unless it is established that the other contracting party knew or should have known of the deceptive act.